The iPhone will cost me at least US$2245, how about you?

The iPhone will cost me at least US$2245, how about you?

Summary: So now that the very slick Apple iPhone TV ads are available for viewing, I am sure many of us have our gadget lust peaked and are thinking about what our iPhone acquisition strategy may be on 29 June. As compelling as the iPhone looks, there are also many of us who are not AT&T customers and are locked into other carriers for a period of up to 2 years. My personal situation results in a couple of alternatives for me to get an iPhone, with a total price difference for 2 years of service totaling at least US$2,245 or US$2,383 and after putting it down on paper I may actually go for it so check out the details below if you are with another carrier and thinking about the switch or addition. If you are with another wireless carrier, have you been considering the Apple iPhone and AT&T service too?

TOPICS: iPhone, Mobility, AT&T

iPhone June 29So now that the very slick Apple iPhone TV ads are available for viewing, I am sure many of us have our gadget lust peaked and are thinking about what our iPhone acquisition strategy may be on 29 June. As compelling as the iPhone looks, there are also many of us who are not AT&T customers and are locked into other carriers for a period of up to 2 years. My personal situation results in a couple of alternatives for me to get an iPhone, with a total price difference for 2 years of service totaling at least US$2,245 or US$2,383 and after putting it down on paper I may actually go for it so check out the details below if you are with another carrier and thinking about the switch or addition.

Current T-Mobile Family Plan: I currently have 4 mobile phones on the T-Mobile 2000 minute family plan with unlimited text messaging and unlimited internet. The services and costs are as follows:

  • T-Mobile 2,000 minute family plan - US$99.99/month
  • Cost for each additional phone - US$9.99 (total US$29.97)
  • Unlimited family plan text messages - US$9.99
  • Unlimited internet (EDGE and T-Mobile HotSpot - US$29.99
  • Usual monthly taxes and fees - US$20
  • Total cost of monthly services - US$189.94

Strategy A: Add AT&T and keep T-Mobile service: Given the current family plan I have above and now adding AT&T and an iPhone while keeping my T-Mobile service yields the following costs:

  • AT&T 450 minute individual plan - US$39.99/month (There may be a minimum required voice plan to get the iPhone too.)
  • Unlimited data plan - US$39.99 (final data price still unknown for iPhone)
  • Estimated monthly taxes and fees - US$15
  • Total cost of montly services - US$94.98 (net increase in monthly costs would be US$64.99 since I would drop T-Mobile data plan, US$39.99 - US$29.99 for a US$10 net cost increase for data)

One time costs:

  • Apple iPhone - US$650 (includes taxes)
  • Activation fees - US$36
  • Total - US$686

So I would have to fork over US$686 for one time costs and then US$64.99 per month more than what I pay for T-Mobile for a period of 24 months which totals US$1,559.76. Thus Strategy A yields a total additional cost out of pocket for the iPhone and AT&T service of US$2,245.76.

Strategy B: Switch entire family to AT&T: Given the current family plan I have above and now dropping T-Mobile completely while adding AT&T and an iPhone with the same type of family plan yields the following costs:

  • AT&T 2,100 minute family plan - US$109.99/month
  • Cost for each additional phone - US$9.99 (total US$29.97)
  • Messaging starter (200 text messages) for each phone - US$4.99 (total US$19.96) Why doesn't AT&T have a family plan text messaging option?
  • Unlimited data plan - US$39.99 (final data price still unknown for iPhone)
  • Estimated monthly taxes and fees - US$20
  • Total cost of monthly services - US$219.91

One time costs:

  • Apple iPhone - US$650 (includes taxes)
  • New family phones (est.) - US$100, assuming my wife doesn't want an iPhone :)
  • Activation fees - US$114
  • T-Mobile service cancellation fees (US$200/phone) - US$800
  • Total - US$1664

So I would have to fork over US$1664 for one time costs and then US$29.97 per month more than what I pay for T-Mobile for a period of 24 months which totals US$719.28. Thus Strategy B yields a total additional cost out of pocket for the iPhone and AT&T service of US$2,383.28. If I didn't have to pay those crazy US$800 cancellation fees this option would only have an out of pocket increase in cost of US$1,583.28 and I would select it without hesitation. The one-time costs and lower monthly costs are actually more attractive to me since I think I could more easily swallow only seeing the higher costs once, rather than monthly.

Differences between AT&T and T-Mobile: T-Mobile only supports EDGE as its fastest data speed, which is somewhere between 120-140 kbps in most cases. AT&T supports EDGE, UMTS (250-350 kbps in most cases), and HSDPA (750-880 kbps in most cases with theoretical speed of 1.8 mbps), although the iPhone is limited to EDGE. However, I do have other SIM unlocked devices with 3G capability and could finally take advantage of the high speed, 3G data networks the devices are designed to support. There are a few tri-band devices I have under evaluation that do not support the 850 MHz band, but most new devices have quad-band so this is really a minor concern.

There are no rollover minutes with T-Mobile like there are with AT&T and sometimes this would be handy to have. AT&T doesn't have an unlimited text message family plan option, but I think 200 messages each may be enough for our family at this time anyways. T-Mobile customer service has always been excellent and I do not have any personal experience with AT&T/Cingular so I'll have to search around for some feedback on this aspect. Cingular has been coming out with some cool devices (BlackJack, Nokia N76, BlackBerry Curve, AT&T 8525, Treo 680, and Treo 750), but T-Mobile does have the Dash and Wing. I get a full signal in my house with T-Mobile and AT&T (I had a test SIM for a month) so that isn't an issue. I will have to get all my numbers transferred over, which was a bit of a pain the last time I did it 4 years ago.

There is very little difference in cost between adding an AT&T line of service or switching everyone to AT&T, but it would be easier to manage a single account and SIM rather than carrying an extra phone or swapping SIM cards all the time. I would love to have the AT&T 3G data service so I could pop it into my review devices and experience 3G so I am leaning towards this option.

Quick thoughts on the iPhone: While the iPhone runs on the EDGE data network and there are still many unknowns about the device, it looks slick and I really like Apple products. I use a MacBook Pro as my primary home PC and have been using Apple computers since 1989. I would love to have a widescreen video iPod and the iPhone is the only solution for that functionality. The non-removable battery option concerns me a bit, but I am sure there will be 3rd party solutions soon (although that will add bulk to the device). Being that this is the first device I am sure it will also be buggy like other Apple products, but as a gadget freak and early adopter there has to be someone out there like us that takes the bold step forward and forks over the big bucks to help our fellow citizens.

Bottom line: So after laying this all out on paper, I am seriously considering a switch of my entire family from T-Mobile to AT&T and you may see me in line on 29 June along with the other rabid Apple fans. I may even look at going with a different device, like the Treo 750, and AT&T service now that I mapped out all my costs.

UPDATED: The iPhone voice and data plans have been posted on the Apple site and I offer a revised Strategy A below. Due to the much lower than anticipated data/voice plans, you will most likely see me in line on Friday hoping to pick up an iPhone.

Strategy A - Revised: Add AT&T and keep T-Mobile family plan: Given the current family plan I have above and now adding AT&T and an iPhone while keeping my T-Mobile service yields the following costs:

  • AT&T 450 minute individual iPhone plan - US$59.99/month
  • Unlimited data plan - included in monthly plan cost
  • Estimated monthly taxes and fees - US$10
  • Total cost of montly services - US$69.99 (net increase in monthly costs would be US$40 since I would drop the US$29.99 T-Mobile data plan)

One time costs:

  • Apple iPhone - US$650 (includes taxes)
  • Activation fees - US$36
  • Total - US$686

So my new total to pick up an iPhone would be US$686 for one time costs and then US$40 per month more than what I pay for T-Mobile for a period of 24 months which totals US$960. Thus my revised Strategy A yields a total additional cost out of pocket for the iPhone and AT&T service of US$1,646.

[poll id=6]

Topics: iPhone, Mobility, AT&T

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  • My two cents

    Cell phones are two year throw away items. I will NEVER pay $500 for a phone... the battery will not last for two years and then what do you do.. ? Send your phone away to have the battery replaced... it's a cell phone.. .what will you use in it's place... ridiculous that the battery cannot be replaced like all other cell phones.
    • You can not replace the battery?

      I did not know that. I guess one would have to purchase the extended service plan, or send it to Apple to have the battery replaced, either option is an additional expense.
      • Bimbo iPhone - crippled and expensive

        Not only is Apple's BIMBO iPhone outrageously expensive but it is a crippled and stupid phone:








        - NO FM RADIO


        It's a BIMBO phone alright; a stupid piece of crap and you need both hands and eyes to use it. Only Mac fanatics and stupid bimbos will buy it.
        • Only Mac fanatics and stupid bimbos will buy it

          Well, while this may be something of an over-statement on your part, there certainly is something of a grain of truth buried therein.

          I was just at the Apple website looking over the specs of the iPhone. It definately has some interesting design features - notably the accelerometer and proximity sensors. But, these are the only true inovations of this product. Basically everything else that Apple trumpets about this phone is already available on other devices - often in even higher functioning forms.

          Apple acts as though they just invented touch screens. Their implementation has one nice feature, namely, the ability to touch-and-drag on-screen applications. However, I cannot determine if the iPhone will have the ability to transcribe handwriting with a stylus (it does not appear that it can, but I can't find any definative info that it cannot). As one who's hands are already too large to work well on a so-call "full-size" keyboard, a 3.5 inch QWERTY on screen keyboard just isn't that easy to use (I have SBC's Full Screen Keyboard on my PPC, so, I do know what I'm talking about here). The ability to write directly on my PPC's screen and have it transcribed directly works much faster for me. I'd count the lack of such functionality (as it now seems) as a serious deficiency.

          Which is, as I see it, part of the larger problem with the iPhone. I'm referring to the apparent attempt to make it the one gadget to replace all others, which ends up in a reduced-functionality version of the combined devices. As a PPC user, an iPod owner, along with having a cell phone and a high-end digital camera; I'd often mused about the possibility of merging all functionalities into one single device. However, my personal observations are that, given current technology levels, separate and distinct functionalities are still best accomplished by dedicated devices.

          I'll certainly give Apple that they've given it a good shot, and their input will almost certainly drive the innovations of subsequent generations of products. Yet, they've still come up a bit short of the end-all, beat-all gadget (as they seem to now claim).

          Another poster pointed out the lack of applications (such as can be purchased/written for PPC's. The Apple site touts the iPhones use of OS X as the operating system. This would seem to be implying that the phone could run regular Mac apps; however, this seems highly unlikely, not least of all because it is not stated as a selling point by Apple.

          And, while a 2 MP camera may be better than the 1 MP found in most other phones, it's still practically a waste (will anyone really be happy with 2 MP pix?).

          I suppose I could go one point-by-point about the trade-offs of functionality for the goal of an all-in-one device, but I think it will suffice to say that the iPhone leaves plenty of room for improvement. Just don't try convincing those Apple fan(atic)s of it.

          This first round will go mostly to the show-off bimbos you cite, but some people will eventually come around to buying it for it's abilities (even if they are limited). For all the faults we can see in it now, I'd hardly be suprised if the subsequent products of all manufacturers were not to driven with a eye towards what Apple has done with the iPhone. Personally, I think it's a very good start, but just that - a start. By gen 3, the iPhone just may well be the (nearly) perfect all-in-one gadget.
          • Proximity Sensor isn't new

            My Nokia 7650 had a proximity sensor doing much the same job as its now doing on iPhone, and that was way back in 2002 so the list of innovative features is reduced to 1.

            Apple fanboys are about 3 or 4 years behind the rest of the world, features the rest of us had taken for granted years ago are considered fresh and innovative in the world of Apple.

            Only a handset aimed at the American market could be so obesely large and so far behind the rest of the world, why would anyone build a phone that was so large and yet pack such shoddy features into that large space, so what it can run OSX something that large should be able to wash my clothes while its at it.
          • Only a handset aimed at the American market


            Now that's what I'm talking about (I don't know if you've noticed yet or not, but I sort of scolled you for going after the motives of the author in another post). But, here you've posted some excellent insights.

            I was not aware of a previous usage of a proximity sensor, so I stand corrected on the innovations of the iPhone.

            And, while it's a interesting feature to include, one has to wonder just how much one gains by it, and at what cost. Likewise the accelerometer - cool enough, to be sure; but functionaly the same as tapping a PPC screen to change orientation. If the cost were minimal for such a sensor, it would be a great idea. However, if it adds significant expense to an already pricey product, it should definately be optional/upgradable (but that seems to run counter to the Apple strategy).

            And, as to your point about the size of the handset, it seems remarkable to me that it is still being marketed as a handset. A device such as this (as most smartphones) would be much better utilized in conjunction with a bluetooth earpiece/microphone. The percieved need to hold a box up to ones ear to communicate reminds me of a smokers "oral fixation".

            Apple makes no mention of voice control (via bluetooth), but full voice control, including over the iPod (I've seen this very thing in automtive voice control systems) plus voice transcription capabilities for text input would go a long way towards making the iPhone (or any other data/phone/mp3 player) a much better device.

            In the end, I see the first iPhones as trial balloons - a way to see which features consumers will respond to, and how much money and freedom of choice they'll part with for them.
          • Indeed

            Yup I think I may have scolded you back somewhat, in my defence my previous posts are in no way aimed at yourself and more so the author of the article.

            The accelerometer is interesting, although like you say its just an extravagent feature that can be replaced with one button, the Nokia 5500 also has an accelerometer but I haven't used one so can't comment on its use or similarity to iPhones.

            iPhone is designed for the US market and this is the problem with most if not all US designed handsets, they may look cutting edge in the States but in Europe they look very dated, its pointless having loads of features if the product is too big, its also pointless if those features are all old
        • Pretty slick really.

          Your post is somewhat fanatical. I've owned a number of mobile phones, my latest
          has gone 5 years without a new battery. I don't see the battery as much of an
          issue. It will be 2-3 years at least before replacement is required, and by then
          there will be lots of solutions.

          As for your other points:

          - iTunes: you don't have to use ITMS, iTunes is just an MP3 player and music sync

          - Integration with corporate applications: most new apps are web based and if
          done right will run in Safari, or could with about the same amount of work as
          required to make them run with IE on Windows CE.

          - No third party apps: give it some time.

          - No external memory card: not really an issue for me, but since it has WiFi,
          Bluetooth, internet and e-mail, transferring data shouldn't be a problem.

          - Crippled browser: quirk for quirk, I think Safari is streets ahead of IE, especially
          IE on Windows CE.

          - No voice recorder: possibly a negative, but I don't see it as a killer app.

          - No FM radio: not having a radio really killed iPod, didn't it? Ever heard of

          - No Outlook, etc. It has iCal and e-mail, no real issues there. As for no Flash,
          that's a bonus, isn't it? :-)

          Will I buy one? Not likely, but I still think it's a cool device if it's as good as the
          demos indicate.
          Fred Fredrickson
          • Battery no much of an issue


            I'd have to agree with you of this one. As the owner of a 2 yr-old iPod, I've not had any battery problem yet, and although it will take a little know-how (as opposed to popping open a door) I already know where I can purchase a replacement, and how to make the replacement.


            I don't think you should be so quick to dismiss some of the other points the poster was making.

            Consider that from all accounts, it does not support syncing with Outlook. You say "It has iCal...". However, consider that Outlook is now a stable and mature product that many organizations have standardized on. Will the iPhone require importing information from Outlook to whatever desktop sync software it is to use, or will that software be able to use Outlook data directly? It may not even be a consideration for you personally, but if Apple wants to sell to a bigger audience than cool-hip teens with deep pockets, the ability to work seemlessly with the bussiness world would be a big plus.

            Or, how about that lack of voice recorder? It's not a deal-breaker for you, but for a person such as myself who sees the greatest utility in a mobile device when it is not tied to the need to use a mini-QWERTY keyboard nor phone number pad, that they left it out is a dissapointment.

            Apple's web site makes no mention of voice control, opting instead to the stress the ease of making calls by poking at the touch screen (as opposed to poking at a keypad?). I'd like to assume that voice accuation is an included feature, but I cannot find where Apple states that it is. Personally, I'd never even consider a phone with which I could not use voice dialing.

            Which also leads to another point. Although Apple would like to claim "...making it easier and more efficient to use than the small plastic keyboards on many smartphones", a QWERTY touchscreen keypad laid out on a 3.5 inch screen is still going to be difficult for adult-sized hands. So, it seems with the iPhone you can be a two-finger typist rather than a two-thumb typist with the "plastic keyboards"? Hardly worthwhile.

            The real textual input functionality for mobile divices comes either from handwriting transcription or from voice entry. I mentioned to another poster that I cannot see where the iPhone will have transcription ability, and the lack of a voice recorder suggests to me that Apple is making no consideration towards either voice commands nor voice text input.

            And, lack the of 3rd-party apps (if, and when they are allowed - not clear yet), will mean that the iPhone will NOT make for an adequate replacement for those of us who use mobile devices to actually run apps - even when there is neither WiFi nor phone service available.

            And, further, at only 8 Gb, it really could use an SD slot.

            To sum up:

            As an iPod, it lacks capacity (Nano-sized, minus OS and other data).

            As a PDA/Email device, it's anyones guess as to whether it offers anything better than other devices (or, at least, anything to make it worth the cost).

            As a mobile computer, only web based apps is a big minus - plus the need to use a tiny QWERTY keyboard only exascerbates it's difficiencies.

            And, finally, as a phone (which, you might recall was the original theme of the article) it will lock users into a single choice, at yet-to-be-determined costs, and which may not remain "cutting-edge (no pun intended)" during the service contract life-time.

            A nice try, but well short of ideal.
          • at only 8 Gb, it really could use an SD slot


            if you'll indulge me, I'd like to add to this thought.

            It's not really just a matter of limited capacity, but of quick access, without the need to create duplicate info.

            You mention the suppose ease of data transfers, but, indoing so, you're constantly creating duplicate files - the file which will become resident on your device after the transfer, taking up space. And, even fast wireless transfers cannot match the speed of popping an SD card out of one device and popping it in another. I can take an SD card from my camera, and stick it in my PPC to view pictures and movies on a bigger screen - without having to take the time to make a copy. I can move data files from computer to PPC without the need to sync (and, the time involved with doing so).

            And, although I like a great many things about my iPod, perhaps it's biggest single hassel is the need to sync with iTunes (or another manager software package) to add to/remove from the library. I only use 23 out of 30 Gb's, but adding more to the 3600 songs already on-board only makes the scroll lists longer on my iPod. And, for things like podcasts, which I only want for a limited time, it would be so much easier to put them in a playlist on an SD, pop that card into the iPod, listen, then eject - without the need to sync with iTunes, then sync again and scroll through the library to remove them.

            I do believe I'll write to Apple and suggest that the next generation of iPods should include a card slot.
          • Problem is cost. When the price is right, people will buy anything

            This is something I made a point on weeks ago when there was a blog going about the iPhone and its anticipated cost. The problem is that the pricing is ludicrous. Ask a business man (actual people who spend large dollars on cell phones)if he would rather try out the new iPhone for that kind of money or go with the new Blackberry 8800, and I think a conservative estimate would would see better then 80% of them opt for the 8800. And thats a problem because the vast majority of the $200+ smart phones end up in the hands of people who use them for work, and that means business people.

            The mass of people who purchase cell/smart phones of course might think the iPhone is very cool, but they already usually have a pretty good phone, often the best they can afford and those mass number of phones are sub $200 phones that the average person can afford and justify.

            My work demands a high quality cell phone and the more practical functions it has the better off I am. I chose the HTC 621 at $250 with a 3 year $CN/month plan I don't see a better choice out there. I even looked at Blackberry's and they fell short in just enough areas in the price range to make the HTC the best choice.

            With a full qwerty back lit keyboard (a must for me)blue tooth and wireless, the Microsoft mobile operating system, camera, voice recording, great battery life of about 5 hrs talk time and a very inexpensive upgrade of a 2 gig micro card it does a lot. It reads doc's, pdf's, Excel and powerpoint has a real nice screen of a fairly large size, and best of all, its slim and light. Put in a suit jacket pocket and its weight is just barely enough to notice there is something there but not enough to ever be in the least distracting in any way. The slim size makes it slide into a pocket and never feel bulky.

            Like any device its not going to be the best choice for everyone, I have no doubt for some its not what they need at all. But the problem is, just the mere fact such a quality device exists and can be had for $250 paying double or more should provide for a device that has some things in the level of performance that are clear cut innovative and of some significant advantage to have. And that would be without trading off any features or design factors that are also highly valued in a cheaper device.

            One thing for sure. The average business person (those with the money to purchase high end smartphones) are not going to kick in big bucks to tote around all day, something that feels akin to carrying around a brick in your pocket.
          • What a MACTARD

            - YOU MUST have an ITUNES account with your iPhone. And no you CANNOT use someone else's MP3 player ( an application)

            -Most new apps are NOT web based, they connect via the Web but are client applications connecting through the internet. NOT the same.
            iphone only allows you modify your WEB Applications to ALLOW the iphone to use it! - PATHETIC!

            -No 3rd party applications because you can only have dinky ones, with no SDK developers pack, cannot run Java, and cannot play flash.

            -Thus the above makes it a crippled browser!!

            - No need for IE on the phone, get Opera instead~!

            -No voice recorder, no memos for business guys or remembering something for later.. simple... but too much for the iphone.

            -I agree no FM radio, but also NO WEB RADIO, why? because no 3rd party apps.

            - it syncs with outlook, but for see calendering problems as usual with Mac software.

            Look this is NOT a phone with kewl features.

            Its a KEWL media player device, with a touchscreen, that can do some phone funtions. All of its functions are limited because its not an operating system... its a fricken limp dicked BROWSER!!
        • agreed

          no one will buy it.. its totally outrageous that apple rips microsoft for being over proprietary... even microsoft is understanding that apps need to be more flexible..(partnerships with novell and linspire). Apple will keep selling their religion....

          Honestly... the new treos and nokia smart picture phones are may cooler and about half the price.

          Hmm... Im cool! I make 100k a year and can afford an iphone and you cant na na, nah na, na...
      • Not that I have seen one..

        But I did read in an article about it, that it will have a user replaceable battery, have to wait and see I guess
    • Agree 100%

      Agree with you 100%. Cell phones die within the 1-2 year range, and need to be replaced at full value. Verizon is the worst for this. I generally pay extra for the 1 year contract, but these are becoming fewer and fewer. I am almost ready to switch to a prepaid plan if the costs were not so much higher. I also generally get the free phones.
      • Verizon Phones DIe?????

        I have a 5 year old Verizon phone model LG VX4500 that still works just fine. Don't use it anymore as I tend to get a new phone every 2 years (part of the Verizon plan) but used for 2 year straight without a problem. Basically I want a phone to do what a phone should do keep numbers and make/receive phone calls. The rest is just BS.
        • LG VX4600

          When I renewed my Verizon contract I got a Chocolate (1 yr. old & I like it very much). I gave my two year old Verizon LG VX4600 to my sister so it's 3 years old now on the original battery and going strong. I can't honestly say I've ever had a single gripe about LG phones or Verizon service.
        • phones get banged up too

          Do you think the average iphone user will let someone use their phone ever. I wonder what percentage of iphone users will even let their friends use it to make a call.

          The reason for the point.. is that phones get banged up, dropped, scratched.

          Im imagining iphone users super paranoid that their phone might take a hit.

          not good for the psychie
    • you make sense

      exactly.. i pay 30 bucks-ish a month... I have a decent dell notebook that i take with me most places, and am buying a powerful desktop for serving up some applications with dyndns, and for playing really cool games. why would i need an i phone and 100 phone bill every month for unlimited use of all its features... NO WAY! My cell phone which i use to talk to people mostly, doesn't need all those features, even though its some cheap free nokia from tmobile. I bet the iphone will be slow serving up all your goods too... we'll see.... The performance will only be as good as network speeds also
  • Made up nonsense

    As you state in your article, you have no idea what the actual plans used by the iPhone will cost per month. So all of the numbers you've used here are completely fabricated out of thin air. What inspired you to write an article where you'd have to make up all of the data you'd be analyzing? Did you factor in costs for food for your unicorn and flying pig that will be required by AT&T with purchase of an iPhone?

    Sheesh. Back to the real world. If you want out of your cel phone contract, the trick is to wait until they change the terms of service, when you are legally allowed to drop a contract with no termination fee. Here's a search on that will bring you all sorts of articles on getting out of a cel phone contract with no fee:
    tic swayback